Governance & Reports
Governance
McCord Hospital is a Section 21 Company, not-for-shareholder-profit entity. Any profits which are generated will be re-invested into the Hospital to further improve the medical equipment, facilities and provision of patient care.
McCord Hospital is governed by a seven member Board of Directors led by Chairman Professor Paulus Zulu. The Board meet once per month and are responsible for the implementation of good corporate governance at McCord, for providing advice on the future strategy of the organisation, and for providing input and advice on key operational decisions as required. Click here to view profiles and photographs of our Board of Directors.
The role of the Executive Committee is to support the Chief Executive Officer in managing the operations of the Hospital. The Executive Committee meets on a weekly basis to discuss and decide on operational policies appropriate for the Hospital, monitor progress on the change management initiatives and make decisions within the scope of the authority delegated by the Board. The Executive Committee is also responsible for the implementation of appropriate monitoring and preventative controls. Three key areas of Information Technology Communication, Staff Development and Human Resources are represented on the Executive Committee. Click here to view profiles and photographs of the Executive Committee members.
Day to day operations are headed up by a strong Management Team, led by the Chief Executive Officer, Dr Helga Holst. As at 2010, McCord operates under a Business Unit organisational structure. Business Units consist of multi-disciplinary teams built around the delivery of the hospital's key service areas. The Business Unit Leaders are responsible for the operational and financial performance of their Business Unit, and have helped to establish decentralised accountability across the hospital. Regular meetings are held with all Business Unit leaders as a group, and on a one-on-one basis, to ensure best practices are shared and Hospital-wide policies are implemented as far as practically possible. Click here to view profiles and photographs of our Business Unit Leaders.
McCord has the following Business Units:
1. Specialist Care (includes obstetrics & gynaecology, anaesthetics, medical inpatient care, orthopaedics, paediatrics, surgery and surgical facilities)
2. Clinical Governance (includes infection control, occupational health and safety, clinical auditing and quality assurance)
3. Emergency and Ambulatory Care (includes trauma and emergency, general outpatient care, the diabetic, hypertension, psychiatric and Injury on Duty clinics)
4. HIV Care (provides comprehensive HIV Care and Treatment including Voluntary Counselling and Testing, preparation for and commencement of Anti-Retroviral Treatment, and Prevention of Mother to Child Transmission Programmes)
5. Allied Health Services (includes pharmacy, x-ray, laboratory, psychology, social work, physiotherapy, occupational therapy, dental, ultrasound, ECG and audiology)
6. Senior Nursing Services (oversees all nurses in the hospital, across all Business Units and ensures that nursing professionalism, quality and standards are maintained)
7. Nursing School (oversees the highly acclaimed McCord Nursing School)
8. Research (oversees all research projects taking place at McCord)
Financial Overview
Though McCord is a not-for-profit organisation, the financial aspects are still critically important for the future sustainability of the Hospital. Sustained operating losses could potentially result in the forced closure of the Hospital, or severely limit the funds available for re-investment in the Hospital in the form of capital equipment, staff training and development.
The vision for the Hospital is to provide high quality, low cost healthcare to our patients whilst maintaining a sustainable financial model. This is an extremely difficult balance to achieve in view of the significantly increased cost of providing healthcare, the global financial crisis, a severely stretched national health system and the patients’ wishes for the best possible health service. Excellent financial management is a cornerstone of this vision, to ensure that we make optimal use of the resources with which we are entrusted, and to ensure a cost-effective service delivery.
Fixed fee approach
There are a number of models currently being developed within South Africa by both the Government and the Private Sector to try to address this growing need for the provision of extended healthcare services to the lower income population who cannot afford to fund the cost of private medical treatment. These initiatives include:
· Public-private partnerships for health care facilities
· Differentiated amenity facilities (a private wing within a public sector hospital)
· National Health Insurance
There is also an increasing requirement for a fixed fee type approach to be offered by healthcare providers. This fixed fee approach is the preferred approach for the payor (patient, medical aid or Department of Health), but this presents a far greater risk to the healthcare provider due to the nature of services offered. In order to provide an exact cost estimate at the point of admission, it is necessary to have:
· An exact diagnosis
· An exact prescribed treatment protocol
· An exact cost attached to the prescribed treatment protocol, which can be updated regularly as costs increase
· No complications or no further treatment required
Patient treatment is not an exact science, and thus the scenario set out above is not feasible. Even if you were able to derive a model for the categories above, it is likely that the profile of the patient is likely to impact the treatment required, and their response to it. The healthcare provider is thus forced to build in an element of contingency into their prescribed treatment, which results in a risk premium being built into the fixed fee approach.
This is a dilemma which McCord Hospital currently faces. The target patient market is the employed but uninsured group, and the average patient does not have a large amount of savings available to them. An incremental billing approach is not considered feasible for the Hospital, and is likely to result in either the patient not receiving complete patient care due to financial constraints, or the Hospital providing the patient care regardless of financial affordability and the hospital then bearing a loss when the patient cannot afford to pay. The Hospital has thus opted for a fixed fee approach. During 2010, Hospital management is undertaking a review of all fixed fee procedures to better understand the treatment protocols for each procedure, and the cost associated. Hospital management will also partner with both the government and private sector to compare information collected in this regard.
The implementation of TrakCare, the online patient management system, is anticipated to significantly improve and simplify the process of collation of this information, as every order item will be recorded for each patient visit. This history of detailed patient information being available in a format which will allow for data interrogation will help management better understand the cost of treatment protocols. This will ensure our Hospital fees are appropriately priced.
Funding model
McCord Hospital offers a subsidised fee for patient service. McCord Hospital is fortunate to benefit from a number of long-standing relationships with donors and funders. These grants and donations help to reduce the payment required by the patient, or student nurse. The main sources of funding are as follows:
· The KwaZulu Natal Department of Health (DoH) provides a monthly subsidy in terms of a Service level agreement, whereby McCord will support the DoH in the provision of healthcare services in the province and on the terms and conditions stipulated in the SLA.
· Funds received from the US Aid program, PEPFAR, in terms of which McCord Hospital receives a significant portion of the funding required for the HIV Services provided at McCord.
· Donations received from individuals, companies or other organisation who support the work undertaken at McCord.
Financial position
The 2010 Annual Report contains further information and explanation of the financial position of the Hospital. The Hospital is currently in a difficult financial position with a number of years of operating losses having really stretched the Hospital’s available financial resources. A number of change management initiatives undertaken at the Hospital are with the intention of achieving financial sustainability. It is pleasing to note the improvement in financial practices which this management focus has already yielded, and this is anticipated to reflect in an improvement in the financial results of the Hospital.
McCord Hospital needs to target profitability for a number of years to reduce the accumulated deficit which has built up over the years. Management are also working hard to change the perception that “profit is not a good thing for a not-for-profit institution.” A sensible level of profit is critical to ensure sufficient funds are available for the necessary investment in capital equipment. A return to profitability for the Hospital is also necessary to attract external donor funding, and as a Christian hospital we believe in the biblical principle which requires us “to be faithful in the small things, to be rewarded with bigger things”. The Board and Hospital management believe that McCord can play an integral role in defining the future of low cost healthcare services in the country, but we fist need to prove our credentials by achieving operational and financial excellence at McCord.
Reports
Annual Financial Audits are conducted by independent auditors, Deloitte.
Click here to download the 2010 McCord Annual Report.
Audited financial statements from previous years are available upon request.